FXstreet.com (Barcelona) - Despite continued efforts by the government to roll out reforms, the performance of the INR has not been as strong as anticipated, says the HSBC FX Team.

HSBC notes: "We are cognizant of the fact that political developments during the Winter Session of Indian Parliament could create greater noise for the INR. However, we think there is still room for the INR to recover against the USD into the end of the year. There could be a program of further reforms announced, while the RBI has also maintained a tight policy"

"We would also note that recent INR weakness is not completely independent, with some other EM FX current account deficit currencies have come under pressure, suggesting the recent problems faced by the currency are not totally exclusive to the INR itself. We maintain our year-end forecast of 52 for USDINR" HSBC adds.